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to gain information about the Strategic Plan and Research Task Force issues and process,
and to provide Board input as plans are made for the University for its future. He
pointed out that this will not be a Board meeting nor will there be any official action taken
at the meeting.

      K.    Acceptance of Interim Financial Report for the University of Kentucky
for the Three Months Ended September 30, 1997 (FCR 1)

      Mr. Hardymon, Chairperson of the Finance Committee, said that the Finance
Committee met and acted on five items to submit to the Board. He said that FCR 1 is the
quarterly report on the financial condition of the University of Kentucky for the three
months ended September 30, 1997. The University has realized income of 29% of the
budgeted amount for the year and the expenditures are now at 25% of the budgeted
amount. He noted that the balance sheet is in great shape and shows great strength. He
moved approval of FCR 1. Mr. Chellgren seconded his motion, and it passed. (See FCR
1 at the end of the Minutes.)

      L.    Acceptance of the Financial Statements of the University of Kentucky and
Affiliated Corporations and other Related Organizations for the Year Ended June 30,
1997 (FCR 2)

      Mr. Hardymon moved that the Board accept the financial statements of the
University of Kentucky for the year ended June 30, 1997, including separate financial
statements for the Housing and Dining System, the Tobacco and Health Research
Institute, and the University Hospital, and special reports submitted by Deloitte &
Touche on Compliance and on Internal Control and on Compliance with House Bill 622.
He stated that the Finance Committee had a full report, and the important items to
consider are the management letter and the letter involving HB 622 that deals with the
financial management of the University. He noted that a separate letter on internal
control would be sent to the management of the University. The Board will see the letter
and the response to it. He noted that the auditors found no non-compliance aspects with
HB 622. He reported that he and Governor Breathitt had a private session with the
auditors prior to the Finance Committee meeting. In his opinion, it was a very thorough
audit and was well done. His motion, seconded by Mr. Welenken, carried. (See FCR 2 at
the end of the Minutes.)

      M .   Report of Lease (FCR 3)

      Mr. Hardymon moved that the Board accept the report of the lease that is less
than $30,000 in value. He noted that it is a new lease for the use of 192 square feet of
storage space at an annual rate of $864.00 and $4.60 per square foot. Mr. Shoop
seconded his motion, and it passed. (See FCR 3 at the end of the Minutes.)